The Truth About the 3G iPhone "Price Drop"

To no one's surprise, Steve Jobs announced the new iPhone at WWDC yesterday. 3G, and GPS are the two big features.

There was also mention of a $200 price drop, from $399 to $199. But unlike the first price drop from $599 to $399, this one is all spin and BS. This price drop is due to the phone being subsidized by AT&T, and you're actually going to be paying more in the long term. What Jobs didn't mention at the keynote is the 3G data plan is $30 a month, which is $10 more per month than the Edge data plan. Over the lifetime of the two year contract, that adds up to an additional $240. Hmm, that price drop now looks like a net $40 price increase.

If you're thinking about just buying the iPhone, and unlockling it to go with another carrier like T-Mobile, you can forget about it. Apple has changed their activation policy. You now have to active the iPhone at the store. No more at home iTunes activation, no more online ordering. Looks like AT&T has gotten smart to all the unlocking that's been going on.